Stakeholders: Tax reform doesn't look good

Tax observers in Washington aren’t confident about reform in large part because Democrats and Republicans have – for years – sparred over whether a revamped code should raise more revenue.

ADVERTISEMENT

Top Democrats like Senate Majority Leader Harry Reid (Nev.) and Finance Chairman Max Baucus (Mont.) aren’t on the same page on how much revenue to shoot for in reform, and some leading Democrats have shown little interest in reducing individual tax rates.

But Jason Fichtner of the Mercatus Center at George Mason University said Thursday that – despite those differences – Democrats and Republicans have found more common ground on taxes than some might believe.

For instance, Cardin, who has long favored introducing a consumption tax in the U.S., and Rep. Chris Collins (R-N.Y.) both said at Thursday’s event that they wanted to sharply lower individual and corporate tax rates.

Sen. Carl Levin (D-Mich.), another speaker at the event, said that many tax breaks in the code – even those he doesn’t like, such as incentives for the oil-and-gas industry, serve an economic purpose.

“We always focus on the disagreements. They’re always here on the left, they’re here on the right, and nothing in between,” Fichtner said.

Still, Chuck Marr of the Center on Budget and Policy Priorities said there were plenty of reasons outside the policy sphere that tax reform might stall.

Policymakers and stakeholders, Marr said, could find they prefer to deal with a tax code that they know to be too complex instead of dealing with the unknowns of an overhauled system that could be shorn of many tax breaks.

And Mike Roach, a small businessman in Portland, Ore., said he didn’t see an outsized cry from other owners for tax reform.

Roach said he was hoping lawmakers could enact measures to make it easier for small business companies to access capital, and avoid any debt ceiling drama that could hurt fourth-quarter sales. Concerns about President Obama’s healthcare law, he said, were only one part of the list of worries business owners face.
“Small business right now is most concerned with how we create more customers,” Roach said.